Brown vows to boost FSA's oversight role


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The Financial Services Authority received a boost as the government pledged to significantly increase its powers.

In a blow to the Bank of England, the Government published an outline of new legislation that will give it wide-ranging tools to shore up financial stability.

In plans released as part of Gordon Brown's policy 'relaunch' yesterday, the Government said it wants to ensure the City watchdog has 'sufficient powers to do its job'.

Gordon Brown announced plans for new legislation to beef up the FSA's powers at the Building Britain's Future launch

Gordon Brown announced plans for new legislation to beef up the FSA's powers at the Building Britain's Future launch


The document said that these will include: 'Freestanding powers to take certain emergency actions for the purposes of financial stability, including placing restrictions on short selling and requiring disclosure of short selling.'

Bank of England governor Mervyn King has been demanding new tools to probe individual financial institutions that may be taking excessive risks.

But government ministers have signaled they wish to look to the FSA to take the lead.

Last night Lord Mandelson said: 'I believe the lesson of the last year is that we need a stronger regulator, not a weaker one.'

The laws will also aim to better protect consumers from aggressive lenders by banning unsolicited credit card cheque.

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